Ubertini v Saeco International Group SpA (No 4)

The applicants, Ubertini and others, sought relief against Saeco International Group SpA (Saeco), a parent company, and its nominee directors on the board of a subsidiary company. The applicants, minority shareholders in the subsidiary, alleged that Saeco engaged in oppressive conduct by compelling the acquisition of their minority shareholdings, preventing board meetings, and charging penalty interest on debts. The applicants sought relief under the Corporations Act 2001 (Cth) on grounds of oppression and unfair prejudice. The court needed to determine if Saeco’s actions constituted oppressive conduct and if the minority shareholders' actions were oppressive. The court had to examine the nature of Saeco’s conduct, the impact on the minority shareholders, and whether the conduct was contrary to the interests of the members as a whole or oppressive to the minority shareholders.

The court examined whether Saeco’s actions constituted oppressive conduct. It considered the demands for payment, the non-supply of stock, and the appointment of administrators by Saeco’s nominee directors. The court also assessed if the nominee directors failed to properly assist the subsidiary and whether the actions were in the best interests of the company. The court found that Saeco’s conduct, including the prevention of board meetings and charging of penalty interest, was deliberate and aimed at removing minority shareholders from management and acquiring their shares without payment. This conduct was deemed contrary to the interests of the members as a whole and oppressive to the minority shareholders. The court also evaluated the conduct of the minority shareholders, including the transfer of funds, related party transfers, and the incurring of adviser fees. While some actions were improper, they did not outweigh the oppressive conduct of Saeco.

The court concluded that Saeco’s actions were oppressive and contrary to the interests of the members as a whole. The minority shareholders' conduct did not disentitle them from relief, given the oppressive nature of Saeco’s conduct. The court ordered Saeco to pay compensation to the minority shareholders and restrained it from engaging in similar conduct in the future. The court also issued directions regarding the administration of the subsidiary, ensuring fair treatment of all shareholders.